The Cable

Putin Among the World Leaders Linked to the Panama Papers

Russian President Vladimir Putin is among the world leaders linked to the Panama Papers.

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The massive, anonymous leak of more than 11.5 million documents belonging to a law firm in Panama — Mossack Fonseca — has leaders around the world in hot water Monday.

The documents, initially shared with German newspaper Suddeutsche Zeitung, show that 140 politicians from more than 50 countries — including 12 current or former heads of state — did business with the law firm. They reveal more than 214,000 offshore entities across more than 200 countries, and cover the period from the 1970s to December of last year. The International Consortium of Investigative Journalists, which is made up of more than 100 publications from nearly 80 countries, led a yearlong investigation into the files. It’s the biggest leak in whistleblower history.

Panama has long held a reputation as a safe haven for drug money, which is heavily invested in real estate there. But the leaked documents show that the Panamanian law firm helped wealthy individuals from around the world create offshore accounts that could be used to launder money. Tax shelters aren’t technically illegal but are frowned upon by the countries where these firms do business: governments want their fair share in taxes.

Many of the people named in the documents have yet to publicly respond to the leak. But it’s already put Iceland’s prime minister, Sigmundur David Gunnlaugsson, at risk of losing his job. There’s a no-confidence vote set for Monday for allegations in the documents that he deliberately hid holdings in Icelandic banks in offshore accounts. When he was asked about the allegations, he walked out of an interview.

Russian President Vladimir Putin is also implicated in the leaked documents. His name doesn’t appear in the records, but the names of some of the strongman’s associates do. This includes musician Sergei Roldugin, godfather to his daughter Maria and the man who introduced Putin to his wife.

The papers show Roldugin made millions from deals that would have been difficult to do without Putin’s knowledge. On Monday, Dmitry Peskov, Putin’s spokesman, told Russian news agency Interfax that it was “obvious” the leak was meant to undermine the Russian president ahead of parliamentary elections set for September.

They also indicate that as much as $2 billion has been secretly sent through banks and shadow companies linked to Putin’s inner circle. According to the documents, Bank Rossiya, which the United States has labeled the personal bank for high-ranking Russians, and which is under U.S. sanctions, has been key in building a network of offshore companies for rich Russians.

Syrian President Bashar Assad is also linked to the Panama Papers through two cousins, Rami and Hafez Makhlouf. The brothers are gatekeepers to Syria’s oil and telecoms industries, and, for a time, any foreign entity that wanted to do business in Syria had to be cleared by them. Neither Assad nor his cousins have yet to comment.

Argentina’s new president, Mauricio Macri, is also mentioned. He did not declare an interest in Fleg Trading Ltd., where he was a director with his brother and father from 1998, when it was incorporated in the Bahamas, to 2009 when it was dissolved. His spokesperson has said he didn’t disclose his position because he had no money invested with the firm.

Ukrainian President Petro Poroshenko also has questions to answer. According to the documents, he is alleged to have become the sole shareholder of a company that was set up in the British Virgin Islands as Russian troops went to Ukraine to fight alongside separatists in August 2014. There are now calls for his impeachment.

Officials from FIFA, the global governing body for soccer, are also named. Three of the officials charged by the U.S. Justice Department in its ongoing probe of corruption within the organization did business with the firm.

Other leaders and high-ranking officials named in the papers include Bidzina Ivanishvili, former prime minister of Georgia; Ian Cameron, father of current British Prime Minister David Cameron; Salman bin Abdulaziz bin Abdulrahman Al Saud, current King of Saudi Arabia; and Li Xiaolin, daughter of former Chinese Premier Li Peng.

No U.S. officials were named in the leak, although two states — Nevada and Wyoming — are mentioned as tax havens for Mossack Fonseca’s clients. On Monday, U.S. Justice Department spokesman Peter Carr said authorities are reviewing the documents to determine if they contain evidence of prosecutable corruption. 

This post has been updated.

Photo credit: MAXIM SHEMETOV/Getty Images

David Francis was a senior reporter for Foreign Policy, where he covered international finance. @davidcfrancis

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